Solar power Grid parity

1 solar power

1.1 pricing solar
1.2 reaching parity
1.3 rapid uptake

solar power


projection of levelized cost of electricity solar pv in europe


pricing solar

swanson s law states every doubling of cumulative production of panels, there has been 20 percent reduction in cost of panels.

grid parity commonly used in field of solar power, , when referring solar photovoltaics (pv). pv systems not use fuel , largely maintenance-free, levelized cost of electricity (lcoe) dominated entirely capital cost of system. assumption discount rate similar inflation rate of grid power, levelized cost can calculated dividing original capital cost total amount of electricity produced on system s lifetime.

as lcoe of solar pv dominated capital costs, , capital costs panels, wholesale prices of pv modules main consideration when tracking grid parity. 2015 study shows price/kwh dropping 10% per year since 1980, , predicts solar contribute 20% of total electricity consumption 2030, whereas international energy agency predicts 16% 2050.

the price of electricity these sources dropped 25 times between 1990 , 2010. rate of price reduction accelerated between late-2009 , mid-2011 due oversupply; wholesale cost of solar modules dropped approximately 70%. these pressures have demanded efficiencies throughout construction chain, total installed cost has been lowered. adjusting inflation, cost $96 per watt solar module in mid-1970s. process improvements , large boost in production have brought figure down 99 percent, 68¢ per watt in february 2016, according data bloomberg new energy finance. downward move in pricing continues. palo alto california signed wholesale purchase agreement in 2016 secured solar power 3.7 cents per kilowatt-hour. , in sunny dubai large-scale solar generated electricity sold in 2016 $0.0299 per kwh -- competitive form of fossil-based electricity — , cheaper most.

the average retail price of solar cells monitored solarbuzz group fell $3.50/watt $2.43/watt on course of 2011, , decline prices below $2.00/watt seems inevitable. solarbuzz tracks retail prices, includes large mark-up on wholesale prices, , systems commonly installed firms buying @ wholesale price. reason, total installation costs commonly similar retail price of panels alone. recent total-systems installation costs around $2500/kwp in germany or $3,250 in uk. of 2011, capital cost of pv has fallen below of nuclear power , set fall further.

all remains calculate lcoe expected production. modules warranted 25 years , suffer minor degradation during time, needed predict generation local insolation. according pvwatts one-kilowatt system in matsumoto, nagano produce 1187 kilowatt-hour (kwh) of electricity year. on 25-year lifetime, system produce 29,675 kwh (not accounting small effects of system degradation, 0.25% year). if system costs $5,000 install ($5 per watt), conservative compared worldwide prices, lcoe = 5,000/29,675 ~= 17 cents per kwh. lower average japanese residential rate of ~19.5 cents, means that, in simple case skips necessary time value of money calculation, pv has reached grid parity residential users in japan.

reaching parity

deciding whether or not pv @ grid parity more complex other sources, due side-effect of 1 of main advantages. compared sources, wind turbines or hydro dams, pv can scale systems small 1 panel or large millions. in case of small systems, can installed @ customer s location. in case lcoe competes against retail price of grid power, includes upstream additions transmission fees, taxes, etc. in example above, grid parity has been reached in nagano. however, retail prices higher wholesale prices, grid parity may not have been reached same system installed on supply-side of grid.

in order encompass of these possibilities, japan s nedo defines grid parity in 3 phases:

1st phase grid parity: residential grid-connected pv systems
2nd phase grid parity: industrial/transport/commercial sectors
3rd phase grid parity: general power generation

these categories ranked in terms of price of power displace; residential power more expensive commercial wholesale. thus, expected 1st phase reached earlier 3rd phase.

predictions 2006 time-frame expected retail grid parity solar in 2016 2020 era, due rapid downward pricing changes, more recent calculations have forced dramatic reductions in time scale, , suggestion solar has reached grid parity in wide variety of locations. european photovoltaic industry association (epia) calculated pv reach parity in many of european countries 2020, costs declining half of of 2010. however, report based on prediction prices fall 36 51% between 2010 , 2020, decrease took place during year report authored. parity line claimed have been crossed in australia in september 2011, , module prices have continued fall since then.

stanwell corporation, electricity generator owned queensland government made loss in 2013 4,000 mw of coal , gas fired generation. company attributed loss expansion of rooftop solar generation reducing price of electricity during day, on days price per mwh (usually $40–$50 australian dollars) zero. australian government , bloomberg new energy finance forecast production of energy rooftop solar rise sixfold between 2014 , 2024.

rapid uptake

photovoltaics starting compete in places without subsidies. shi zhengrong has said that, of 2012, unsubsidised solar power competitive fossil fuels in india, hawaii, italy , spain. pv system prices decline inevitable subsidies end. solar power able compete without subsidies against conventional power sources in half world 2015 . in fact, recent evidence suggest photovoltaic grid parity has been reached in countries of mediterranean basin (cyprus).

predictions power source becomes self-supporting when parity reached appear coming true. according many measures, pv fastest growing source of power in world:

for large-scale installations, prices below $1.00/watt common. in locations, pv has reached grid parity, cost @ competitive coal or gas-fired generation. more generally, evident that, given carbon price of $50/ton, raise price of coal-fired power 5c/kwh, solar pv cost-competitive in locations. declining price of pv has been reflected in rapidly growing installations, totalling 23 gw in 2011. although consolidation in 2012, firms try restore profitability, strong growth seems continue rest of decade. already, 1 estimate, total investment in renewables 2011 exceeded investment in carbon-based electricity generation.

the dramatic price reductions in pv industry have been causing number of other power sources become less interesting. nevertheless, there remains widespread belief concentrating solar power (csp) less expensive pv, although suitable industrial-scale projects only, , has compete @ wholesale pricing. 1 company stated in 2011 csp costs $0.12/kwh produce in australia, , expects drop $0.06/kwh 2015 due improvements in technology , reductions in equipment manufacturing costs. greentech media predicts lcoe of csp , pv power lower $0.07–$0.12/kwh 2020 in california.